Corn vs. Soybeans in a Delayed Planting Scenario – Profit Scenarios

Source: Barry Ward, OSU Extension

Wet weather and planting delays throughout much of Ohio and the eastern Cornbelt have many producers thinking about switching corn acres to soybeans or the taking the prevented planting option of their Multiple Peril Crop Insurance policy. Ohio had 9% of intended corn acres planted by May 19th which is far behind the 5 year average of 62%. Farms with pre-plant nitrogen or herbicides applied for corn production may have no option to switch to soybeans. Seed availability may also limit choice for some. Other factors, such as strict adherence to a crop rotation or landlord considerations may limit farmer choice when it comes to switching from corn to soybean plantings in a given year. Farm leases may contain specifications on crop rotations or even what crops may be grown. There may also be unwritten agreements between parties that limit the possibility of growing soybeans in successive years.

Producers that don’t have these limitations may be considering the option of switching acres to soybeans and it will likely come down to expected profit. Field by field budgeting is recommended and with delayed planting the yield expectations change as we move later into the growing season. What will be the likely yields for a given farm for the two crop choices? A recent article, “Delayed Planting Effects on Corn Yield: A “Historical” Perspective” is a good starting point in evaluating potential yield loss due to late corn planting: https://agcrops.osu.edu/newsletter/corn-newsletter/2019-12/delayed-planting-effects-corn-yield-%E2%80%9Chistorical%E2%80%9D-perspective

A recent article highlighting faculty in the College of Food, Agricultural and environmental Sciences always provides valuable insight into the possible yield swings related to late plantings of corn and soybeans: https://cfaes.osu.edu/news/articles/late-start-planting-might-not-hurt-yields-much

Looking at some simple scenarios may get your budgeting process moving for your own fields. These scenarios are based on the 2019 crop enterprise budgets available online at: https://farmoffice.osu.edu/farm-management-tools/farm-budgets

Scenario 1 – Yield prospects remain unchanged, new estimated revenue based on today’s markets:

Corn – 170.2 bu/a & 4.00/bu

Returns Above Variable Costs     $293

Soybeans – 51.5 bu/a & 7.90/bu

Returns Above Variable Costs     $207

Price changes in the last 3 weeks have been favorable to corn and shows some advantage to corn with these assumptions using OSUE Enterprise Budgets.

Scenario 2 – Corn yield 13% lower (per OSU Agronomy Guide, planting date 5-22 through 5-27), soybean yields remain unchanged, new estimated revenue based on today’s markets:

Corn – 148 bu/a & 4.00/bu

Returns Above Variable Costs     $227

Soybeans – 51.5 bu/a & 7.90/bu

Returns Above Variable Costs     $207

The choice becomes closer as we see corn still outperforming soybeans (barely) in Returns Above Variable Costs.

Scenario 3 – Corn yield 13% lower (per OSU Agronomy Guide, planting date 5-22 through 5-27), soybean yields 5% lower, soybean seed costs higher due to higher seeding rate (additional 30,000 seeds per acre planted) for late planted soybeans, new estimated revenue based on today’s markets:

Corn – 148 bu/a & 4.00/bu

Returns Above Variable Costs     $227

Soybeans – 48.9 bu/a & 7.90/bu

Returns Above Variable Costs     $175

This choice again favors corn as the lower soybean yield due to late planting and additional seeding costs make the choice of corn somewhat stronger compared to Scenario 2.

The recent announcements of another round of Market Facilitation Payments and changes to Prevented Planting Coverage due to the pending Disaster Aid Bill may add further complexity to this choice.

As planting is delayed further into June the potential lower yields of both corn and soybeans due to a later planting window will tend to favor soybeans. These simplified scenarios are just examples and farmers should budget for the different yield, price and cost combinations based on their own numbers.

Prevent Plant…What’s That Again?

Source: Eric Richer & Chris Bruynis, OSU Extension Educators

Wet conditions in Ohio and the Eastern Corn Belt has slowed (halted?) planting progress for Ohio producers. According to the May 20th Crop Progress Report by USDA National Ag Statistics Service, Ohio had only 9% corn planted. Surprisingly that was ‘double’ what was planted the week before and well behind the 5-year average of 62% planted. In 2018, Ohio was 69% planted by this report date.

Certainly, the Prevent Plant (PP) crop insurance tool has become a hot topic this year. Many of you have had the chance to attend prevent plant meetings or speak with your crop insurance agent. If not, we will try to briefly summarize your options and strongly suggest you talk to your agent or utilize one of the calculators (see associated “Decision Tools” article by Sam Custer) to determine which option best suits your farm operation.

Your first option is to plant the corn crop by June 5, the final plant date for corn (or June 20 for soybeans). Up until the final plant date, you are eligible for your full guarantee at the level you have selected. For example, 80% coverage x 170 bu/ac APH x $4.00 = $544/acre. If you elect to plant corn after June 5, you will incur a 1% reduction in your guarantee up through June 25, at which time your corn will crop will become uninsurable. For example, if you plant corn on June 8, the guarantee formula (170 APH, 80% coverage) would be: 80% x 170 bu/ac x $4.00 x 97% = $528/acre. Planting dates need to be recorded, as these rules apply on field-by-field and acre-by-acre basis.

Secondly, you can elect to switch your intended corn acres to soybean acres. You will not have the option to file a prevented plant claim (unless you arrive at June 20 unable to plant soybeans). You will be charged for the soybean insurance premium, not the corn premium. The decision tool referenced earlier will be helpful here as this is not an easy decision. June weather (local and regional), supply/demand economics, trade policy and input options increase the complexity.

Your last option is to file for Prevent Plant, assuming you did not get corn planted by June 5. The mechanics of prevented plant deserve a review to ensure understanding. Prevent plant covers Yield Protection (YP), Revenue Protection (RP) and Revenue Protection with Harvest Price Option policies and references the February new crop corn pricing period (aka projected price). The projected price for 2019 corn is $4.00/bu and $9.54/bu for soybeans. A corn policy has a 55% Prevent Plant guarantee (buy-up available to 60%) and soybeans a 60% guarantee (with buy-up available to 65%). In order to further be eligible for Prevent Plant, at least 20 acres or 20% of that unit must not get planted (the lesser of the two). Prevented Plant does not affect your yield history as long as you do not plant a second crop. So a quick example (80% coverage, 170 bu/ac APH) for prevented plant corn would be: 80% x 170 bu/ac x $4.00 x 55% = $299/acre.

To be sure, there are costs besides the premium that are associated with Prevent Plant. Are there ‘restocking fees’ associated with returned seed or other inputs? What are the year-long weed control costs? If utilizing cover crops, what will their cost be? What are my land costs or how do I address my land costs? Do I need to pay labor & management costs even though the land wasn’t ‘farmed’? And finally, are their opportunity costs (marketing) missed because of taking Prevent Plant? We do not have space in this article to address these but they are things to be considering.

The reporting of Prevent Plant acres-should you elect that option-is quite simple. First, the total acres of Prevent Plant corn that you can file in 2019 can be no greater that the greatest number of acres of corn you reported in any of the previous four years (2015-2018). To report Prevent Plant acres, you would first need to turn in a notice (starting June 6) to your insurance agent. Then report your Prevent Plant to USDA Farm Service Agency to get it on your acreage report. Then you will need to work with your adjuster to finalize the claim, which will generally be paid within 30 days.

Prevented planting insurance payments can qualify for a 1 year deferral for inclusion in income tax. You can qualify if you meet the following criteria:

  • You use the cash method of accounting.
  • You receive the crop insurance proceeds in the same tax year the crops are damaged.
  • You can show that under your normal business practice you would have included income from the damaged crops in any tax year following the year the damage occurred.

The third criteria is the sometimes the problem. Most can meet the criteria, although if you want reasonable audit protection, you should have records showing the normal practice of deferring sales of grain produced and harvested in year 1 subsequently stored and sold in the following year.

There are many additional questions that we could address in this article but these are the basic options to guide your thought process…unless Mother Nature just won’t cooperate!

SPRING ROLLER COASTER RIDE COMING

Source:  Jim Noel (Edited)

It is spring and with it often comes wild swings. This is what we expect for the rest of April 2019.

A parade of storms will begin later this Thursday (4/11) into Friday (4/12) and follow every 3-5 days. This will cause 2-3 inches of rain on average for Ohio the next two weeks as shown in the attached graphic. Normal rainfall is now almost 1 inch per week. Hence, slightly above normal rainfall is expected. The one exception could be northern and northwest Ohio where it is possible to see less rainfall depending on the exact storm tracks.

We are also fast approaching our end of the freeze season typically in mid April up to around the 20th for much of the state. Some places in the north it can be late April. Right now, everything looks like a normal end to the freeze season. We do see the possibility of another freeze this weekend on Sunday AM especially north of I-70. A few more could happen into the next week or two before coming to an end.

Temperatures are expected to overall be slightly above normal for the rest the rest of April but with wild swings. This should help bring 2-4 inch soil temperatures into the normal range, possibly a degree or so above normal. The exception would be northern Ohio where above normal ice levels this past winter on the Great Lakes will keep water temperatures on the Lakes lagging and may keep air temperatures closer to normal there.

With all the storms lined up, we do expect a windy April as well. Winds of 30-40 mph with gust to 50 mph can not be ruled out Thursday (4/11) or Friday (4/12) this week with storm number one. 30-40 mph winds will also be possible with the storm later Sunday into next Monday and can not be ruled out with the third storm later next week.

After a wetter April indications are for a warmer and not as wet May with the possibility of normal or even a bit below normal rainfall.

Early indications for the summer growing season are normal or slightly above normal temperatures and possibly a bit wetter than normal though June could be a bit drier.

Soybean Planting – Does maturity group affect planting date?

Source: University of Illinois

Should later-maturing varieties be planted first in order to take maximum advantage of the longer time in the field? There’s no problem with doing that, although early planting moves up harvest date some, so works counter to the goal of spreading harvest time by using different maturities. In 2018 we ran a trial at Urbana, supported by a seed company, to see how varietal maturity affected response to planting date. The first planting date was April 26, the last was June 6, and varieties ranged in maturity from MG 2.3 (very early for this location) to MG 3.6, which is a little later than average for this location.

 

For all but the earliest-maturing variety in this trial, the planting date response was almost perfectly linear, with the loss of nearly 7/10ths of a bushel per day of planting delay—a total of more than 27 bushels—over the 41 days from the first to the last date (Figure 2). This loss rate accelerated a little for the latest-maturing variety between May 24 and June 6. The earliest-maturing variety lost only 17 bushels from first to last planting, but only because its yield at the earliest date was so much lower than yields of the later-maturing varieties.

The month of May 2018 was much warmer than normal, and this got the soybean plants off to a very fast start. Warm nights are conducive to early flowering, and this was especially notable in 2018. In the early-planted crop, first flowers appeared in early June, well before the longest day of the year, and unlike the interruption of flowering that often takes place under normal night temperatures for about a week before and after the longest day, flowering was early and continuous in 2018. As a result, nearly half of the Illinois soybean crop was flowering by July 1. The warm May probably affected the yield response to planting date as well; with warm temperatures, early-planted soybeans as fast as late-planted ones, and this widened the developmental gap between the different plantings.

Planted on April 26, the earliest variety reached first flower on June 9 and matured on August 28, compared to June 15 and September 17 for the latest-maturing variety. When planted on May 24, the earlier and later varieties flowered on June 15 and July 2, and matured on September 12 and September 25, respectively. So when planted late, both varieties flowered very early in their life cycles, both spent less time in reproductive stages than when they were planted early, and they ended up yielding about the same. While in this case it’s accurate to say that the later-maturing variety benefitted more from early planting, that’s only because the early-maturing one was physiologically less able to use the longer growing period allowed by early planting to produce high yield.

Reducing soybean planting rates can increase income

source: Michael Staton, MSU Extension (edited), John Barker OSU Extension

Results from 40 on-farm replicated trials conducted in Michigan from 2015 to 2018 build a compelling case for reducing soybean planting rates.

Michigan soybean producers have consistently identified planting rates as the highest priority topic to evaluate in on-farm replicated trials. Furthermore, the producers wanted to evaluate the effect of low planting rates on soybean yield and income. The two factors driving the increased interest in reducing soybean planting rates are seed cost and white mold. To help Michigan soybean producers make planting rate decisions, the SMaRT (Soybean Management and Research Technologies) program conducted a total of 40 on-farm replicated trials from 2015 to 2018. Please see Figure 1 for the trial locations.

Eleven planting rate trials were conducted each year from 2015 to 2017 and seven trials were conducted in 2018. Four target planting rates (80,00, 100,000, 130,000, and 160,000 seeds per acre) were compared at all but one location where the lowest rate was not included. Stand counts were taken to determine actual final plant stands at each location in all years. To calculate the income (gross income – seed cost) generated by each planting rate, we used the USDA projected prices and average seed costs for treated seed for each year. None of the varieties planted in the trials were straight line or thin line plant type and a complete seed treatment was used at 33 of the locations.

Because we conducted the trials over four years, we learned how the planting rates performed over a range of growing conditions. Planting conditions were nearly ideal in 2015 but were much more challenging in 2016, 2017 and 2018 as evidenced by the average stand loss shown in Table 1. Statewide record yields were achieved in 2015 and again in 2016. However, yields declined significantly in 2017 due to excessive early rains and a lack of rain in August and September. Yields rebounded in 2018.

The effects of soybean planting rates on yield and income are shown in Fgure 2. The bars represent yield and the lines represent income. The figure clearly shows the year-to-year variability in yield and income. It also shows that the lowest two planting rates were the most profitable in 2015 and 2018 and the highest planting rate was the least profitable each year. Table 2 shows the average yield and income for all 40 locations.

When all 40 sites were combined, the yields from the highest two planting rates were identical and they beat the 100,000 seeds per acre planting rate by less than one bushel per acre and the 80,000 rate by only 2.2 bushels per acre. The 100,000 seeds per acre planting rate generated the most income.

These results are very similar to the 2018 Knox County Soybean Seeding Rate Trials shown below.

Click here to see the 2018 Knox County data from plot #1

Click here to see the 2018 Knox County data from plot # 2

Click here for the 2018 OSU eFields report

Click here for the MSU data mentioned above

What’s Legal to Apply to the LL-GT27 Soybean – The (maybe almost) Final Story

by: Dr. Mark Loux, OSU Extension

Having to issue a retraction to previous C.O.R.N. article where we thought we had it right is always fun.  About a month ago we ran an article that covered the legality of POST glyphosate and glufosinate applications to the LL-GT27 soybean, which is resistant to both herbicides.  The issue at that time was the legality of applying a mix of both herbicides, based on questions we had received.  Cutting to the quick, our conclusion was that because it was legal to apply the mixture since both herbicides could legally be applied and labels did not prohibit mixing.  We were naïve apparently, because that article caused the issue over whether it was actually legal to apply glyphosate to the LL-GT27 soybean to be raised.  Since then, ODA, USEPA, and the companies who are the involved registrants have been working to come to a solution that clarifies this issue and keeps us all moving forward toward a resolution.  The issue here seems to be this – wording on most glyphosate labels specifies application is allowed to “Roundup Ready” and “Roundup Ready 2 Yield” soybeans, and since the LL-GT27 soybean is not designated as such, those glyphosate products could not legally be applied.  After a month of deliberation, the USEPA issued some guidance which took the form of the following:

“Users of pesticide products containing glyphosate should refer to the pesticide product labels of herbicide products containing glyphosate for the specific registered uses on pesticide-resistant crops such as soybeans with glyphosate-resistant trait(s).  Regardless of the herbicide product name (brand name), if the label of the glyphosate product states it is for over-the-top (post-emergent) use on glyphosate-resistant soybeans, and it is not otherwise restricted by other label statements/directions for use, it can be used on any soybean that has a glyphosate-resistant trait.  However, if the label of the glyphosate product states it is for use on crops such as soybeans, with specific glyphosate-resistant traits by name, then the glyphosate product can only be used on those crop(s) with those traits specifically identified on the label.  Ultimately, growers and commercial applicators must comply with the entirety of the pesticide label.  Please let us know if you have any questions.”

Questions – yes – excuse us while we look for the head scratching emoji.  We can try to interpret in real-life speak.  Here’s what it comes down to:

– the important part of the glyphosate label here is the use-specific directions, or the section within the larger “Roundup Ready” part of the label that deals with soybeans.

If the soybean section of the glyphosate product label does not mention specific genetics by trade name, but just the wording “glyphosate-resistant” or “glyphosate-tolerant”, then it is legal to apply that product to the LL-GT27 soybean.

– if the soybean section of the label restricts use to certain genetics by trade name –  “Roundup Ready”, “Roundup Ready 2 Yield”, etc, then it would not be legal to apply to the LL-GT27 soybean.

– if the wording on the label is along the lines of “For Use on Soybeans with the Roundup Ready gene”, or similar wording with other specific genetics, it would not be legal to apply to the LL-GT27 soybean.

Our not exhaustive search through glyphosate product labels indicates that most if not all do not contain any wording about “glyphosate tolerance” in the soybean section, and indicate use is specifically on “Roundup Ready” or “Roundup Ready 2 Yield” or “Soybeans with the Roundup Ready gene”.   This includes Roundup PowerMAX, Durango DMA, Abundit Edge, Credit Extreme, and Cornerstone to name a few.  Manufacturer reps with a glyphosate product label that varies from this are free to contact us so we know.

The inability to use glyphosate on the LL-GT27 soybean affects primarily growers who bought it for the genetics or other traits and not the LibertyLink trait, who might have planned to use only glyphosate POST.  Most of the utility of this soybean on problem broadleaf weeds comes from the LibertyLink trait though (and it’s definitely legal to apply glufosinate POST).  There’s plenty of generic clethodim around to help out with grass.  We assume label language will adapt over time to take care of the glyphosate issue.  We’re not even sure this issue would have come up if we hadn’t tried to clarify the tank-mix legality and stepped right in it.  There appeared to be some confusion in the field about this though, with different stories being told, and better to just clear it all up way in advance of the season.  Stay tuned for the next chapter.  Offer void where not legal.  Legality may vary by state.  Your mileage may vary.  Side effects may include confusion, apathy, anger, and spontaneous profanity.

What effect will cold temperatures have on pests and pathogens?

Source: the Bulletin, University of Illinois

Many in the Illinois agricultural community are wondering what effects the recent extreme cold might have on pests and pathogens. While it would be nice if the cold temperatures we are experiencing could help to reduce our potential for pest damage, past experience tells us that the most serious pests we deal with are unlikely to be impacted much by these conditions.

Many of the pathogens and insect pests that commonly affect field crops in Illinois are well adapted to survive our winter conditions.  In many cases, pathogens produce recalcitrant survival structures (e.g. cysts in soybean cyst nematode, oospores in Phytophthora, sclerotia in white mold).  These structures allow the pathogen to survive extreme conditions including cold, drought, and flooding. Different species of insects overwinter in different life stages, including eggs (for example, western corn rootworm), larvae (Japanese beetles), pupae (corn earworm, though they do not survive the winter in most of Illinois), or adults (stink bugs). The overwintering stage has characteristics that help these insects to survive the winter, either by adjusting its physiology to better survive the cold, seeking out an overwintering site that protects it (such as soil, tree bark, or leaf litter), or both. The overwintering sites that insects find mean that they are not experiencing the same temperatures that we are when we venture outside. Wind chill has little effect for this reason (even though it has a major, unpleasant effect on us).

Extreme cold temperatures can impact some insects and plant pathogens, particularly those that may not overwinter as well (e.g. powdery mildew).  When cold weather pushes into the Southern regions of the country it can push certain diseases, such as rusts, further south, delaying disease onset in Illinois and other regions further north. The same is true of migratory insects, such as black cutworm and fall armyworm, which do not usually overwinter in Illinois; colder temperatures during winter often delay the arrival of these insects, and may ultimately lead to lower numbers. The opposite is also true – warmer than normal temperatures during the winter can allow these migratory insects to become a problem earlier in the season.

Although cold temperatures may not impact most of the diseases we encounter in Illinois field crops, fluctuation between conditions of cold and warm may have a negative impact on some diseases.  Dormancy by fungican be broken by environmental conditions such as higher temperatures.  This is similar to what occurs in plants, where warm weather may result in trees flushing out buds and flowers.  Consequently, the wide swings in temperature that we have experienced during the 2018/19 winter may negatively impact some diseases. While some insects (such as stink bugs) can also break dormancy during brief warm periods, many of our most serious pests will stay “hunkered down” until the spring and avoid these fluctuations. Unfortunately, insects and plant diseases are unlikely to suffer as much from the recent cold as we have.

Grain Marketing Webinars Offered

Do you want to do a better job of pricing your corn and soybeans? Is grain marketing a confusing and daunting task? If so, this webinar is for you!

Ohio State University Extension is offering a two-session webinar focused on helping farmers become better grain marketers. Participants will have a better understanding of risk, marketing tools, and the development of written marketing plans. These workshops are funded through a North Central Risk Management Education Grant.  Additional information can be found at http://go.osu.edu/grainplan.

Participants will learn to identify their personal risk tolerance and their farm’s financial risk capacity. Both of these are important in developing a successful grain marketing plan. Participants will also learn how crop insurance products effect marketing decisions and effect risk capacity. Grain marketing consists of understanding and managing many pieces of information. Information on the different grain marketing contracts will be presented. These include basis, hedging, cash, futures, and option contracts.  Additionally, participants will be provided an example of a grain marketing plan and the fundamental principles that should be included.

The courses will be offered on two consecutive Tuesdays, starting on March 12, 2019.  For specific times, as well as program registration instruction, go to http://go.osu.edu/grainwebinar. Cost for the program is $30.00.

To request additional information or have questions answered, contact Amanda Bennett at 937-440-3945 or at bennett.709@osu.edu

The LL-GT27 soybean – what’s legal?

Source: Dr. Mark Loux, OSU Extension

We are starting to see the availability of soybean varieties with more than two herbicide resistance traits, which can expand the herbicide options, improve control, and allow multiple site of action tank mixes that reduce the rate of selection for resistance.  One of these is the Enlist soybean, with resistance to glyphosate, glufosinate, and 2,4-D.  As of this writing, full approval for the Enlist soybean is still being held up by the Philippines (because they can apparently).  The other is the LL-GT27 soybean, which has resistance to glyphosate, glufosinate, and isoxaflutole (Balance).  There is no label for use of isoxaflutole on this soybean yet, but it is legal to apply both glyphosate and glufosinate.  In Ohio, as long as neither label prohibits applying a mixture of two herbicides labeled for a specific use, it’s legal to apply the mixture.  So, it’s also legal to apply a mixture of glyphosate and glufosinate to the LL-GT27 soybean.  There is no label that actually mentions or provides guidance for this mixture, which does not affect legality, but could affect who assumes liability for the recommendation to apply a mixture if that matters to you.  Some seed companies are making the recommendation for POST application of the mix of glyphosate and glufosinate to the LL-GT27 soybean in printed materials.  Our interpretation after discussion with ODA, is that these materials are essentially supplements to labels, and so the seed company would assume some liability for the recommendation.

Continue reading

Soybean Seed Quality Considerations for 2019

Source: Carl Bradley, University of Kentucky; Daren Mueller, Iowa State University; Damon Smith, University of Wisconsin-Madison; Shawn Conley, University of Wisconsin-Madison; and Kiersten Wise, University of Kentucky.

Seed quality from the 2018 soybean harvest was below average across the majority of the soybean-producing areas of the United States. Several factors led to poor-quality soybean seed, but some of the most important were wet conditions throughout the fall and subsequent delayed harvest.

The wet conditions delayed harvest and created the right conditions for several seed diseases, including:

  • Phomopsis seed decay (caused by the fungus Diaporthe longicolla, formerly known as Phomopsis longicolla)
  • Purple seed stain (caused by the fungi Cercospora kikuchii and Cercospora flagellaris)

Seeds affected by Phomopsis seed decay can be cracked, shriveled, and have a chalk-white color on the seed surface.

Seeds affected by Purple seed stain are covered in purple blotches, or the entire seed may be purple.

While some areas harvested high-quality soybean seed in 2018, many U.S. seed suppliers have reported that soybean seed for the 2019 crop is frequently testing positive for the Diaporthe fungus that causes Phomopsis seed decay. This is resulting in lower than normal seed germination rates, and could translate to lower than average germination rates in 2019.

While it is impossible to predict 2019 soybean planting conditions, if soil conditions are wet and cool during planting, then it is likely that both seedling survival and plant population will be diminished in fields planted with low-quality soybean seed. This means farmers need to decide now on how to manage low-quality soybean seed to minimize the impact of poor seed quality, low germination, risk for reduced stands, and lower yield in 2019.

Ways to Minimize the Impact of Low-Quality Soybean Seed Continue reading